A New Kind of Credit Report

Most people realize their credit report will dictate whether they get a loan for anything from a car to a house, and if so, what kind of interest rate they’ll pay on that loan. But now, a new kind of credit report, called CoreScore, contains information that digs deeper than ever into your payment history. It details things like rental applications and evictions, pay day loans, auto title loans and rent to own transactions. Even payments to the electric company. It’s all intended to give a lender a better idea of who is asking for money and the likelihood of it being paid back. So where do they get the information?

“From the public records system,” Credit expert John Ulzheimer says. “Traditionally credit reports only hold three types of public records; bankruptcy, tax liens and judgements.”

CoreLogic acknowledges the extra information could hurt some people, while helping others. The company would not agree to go on camera, but in a written statement pointed out “borrowers who would typically have insufficient credit history in traditional credit reports could now have new opportunities.” And Ulzheimer, from SmartCredit.com , agrees.

“The addition of this type of non-traditional information is going to help some people have a credit report who have never had a credit report before.”

But attorney Chi Chi Wu with the National Consumer Law Center sees it a little differently. She’s concerned people who had legitimate reasons for not paying certain bills will now be penalized. For example…

“If there are mice running around, if you don’t have any hot water, you’re allowed to not pay your rent under some jurisdictions. Is the new credit report going to reflect that?” Wu asks.

And what else could be added to these reports? It’s another concern.

“With the push of a button you can aggregate billion of pieces of information about anything and turn it into a consumer report,” Wu suggests.

Ulzheimer still believes the new reports will help both lenders and consumers.

“Now consumers who deserve the credit are going to get it. Those who deserve it at competitive terms are going to get competitive terms, and those who frankly don’t need to be saddles with that type of debt are going to be denied.”